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1 2 3 4 5 6 7 8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 16 17 18 19 20 21 v.

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA

MICHAEL DRAGOVICH; MICHAEL GAITLEY; ELIZABETH LITTERAL; PATRICIA FITZSIMMONS; CAROLYN LIGHT; CHERYL LIGHT; DAVID BEERS; CHARLES COLE; RAFAEL V. DOMINGUEZ; and JOSE G. HERMOSILLO, on behalf of themselves and all others similarly situated, Plaintiffs,

No. C 10-01564 CW ORDER DENYING FEDERAL DEFENDANTS' MOTION TO DISMISS CERTAIN CLAIMS (Docket No. 97)

UNITED STATES DEPARTMENT OF THE TREASURY, et al., Defendants. ________________________________/ Plaintiffs challenge the constitutionality of section three of the Defense of Marriage Act (DOMA), 1 U.S.C. 7, and 7702B(f) of the Internal Revenue Code, 26 U.S.C. 7702B(f), which limit their participation in a Long-Term Care (LTC) insurance program maintained by the California Public Employees' Retirement System (CalPERS). Plaintiffs contend that these

federal provisions violate the Constitution's guarantees of equal 22 23 24 25 26 27 28 protection and substantive due process because they exclude legally married same-sex couples and registered domestic partners. Federal Defendants earlier moved unsuccessfully to dismiss Plaintiffs' equal protection and substantive due process challenge to section three of the DOMA, which establishes a federal

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definition of marriage that excludes legally married same-sex spouses. At that time, Plaintiff couples were all legally married

under California law, so the Court did not find it necessary to resolve whether a cognizable constitutional claim had been stated with respect to 7702B(f)'s exclusion of registered domestic partners as family members eligible to enroll in federally qualified, state-maintained long-term care plans. Nor did the

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 moved to dismiss, pursuant to Federal Rule of Civil Procedure 16 12(b)(6), the claims that 7702B(f)'s exclusion of California 17 18 19 20 21 22 23 24 submissions and oral argument, the Court denies Federal 25 26 27 28 2 Defendants' motion to dismiss. registered domestic partners violates equal protection and substantive due process. Federal Defendants state that nothing in Court specifically address the constitutionality of section three of the DOMA with respect to registered domestic partners. Subsequently, however, Plaintiffs filed a Second Amended Complaint adding as Plaintiffs Rafael V. Dominguez and Jose G. Hermosillo, who are not legally married, but are registered as domestic partners in California. In response, Federal Defendants

their brief should be construed as support for the constitutionality of section three of the DOMA. Thus, Federal

Defendants do not appear to move to dismiss the domestic partners' challenge to that law. Having considered all of the parties'

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BACKGROUND Plaintiffs are California public employees and their same-sex spouses and registered domestic partners, who are in long-term committed relationships recognized and protected under California law. As explained in this Court's previous order, CalPERS

provides retirement and health benefits, including long-term care insurance, to many of the states public employees and retirees

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 Portability and Accountability Act (HIPAA), provides favorable 16 federal tax treatment to participants in qualified state17 18 19 20 21 22 23 24 The list of eligible individuals in subparagraph (C) of 25 26 27 28 3 7702B(f)(2) includes state employees and former employees, their spouses, and individuals bearing a relationship to the employees maintained long-term care insurance plans for state employees, such as the CalPERS LTC insurance program. 26 U.S.C. 7702B(f). and their families. Long-term care insurance provides coverage when a person needs assistance with basic activities of living due to injury, old age, or severe impairments related to chronic illnesses, such as Alzheimers disease. Internal Revenue Code 7702B(f), which

was enacted on August 21, 1996, as part of the Health Insurance

Section 7702B(f)(2) disqualifies a state-maintained plan from this favorable tax treatment if it provides coverage to individuals other than those specified under its subparagraph (C). 7702B(f)(2)(C). 26 U.S.C.

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or spouses which is described in any of subparagraphs (A) through (G) of section 152(d)(2). 26 U.S.C. 7702B(f)(2)(C).

Section 152(d)(2), the part of the tax code from which subparagraph (C)(iii) draws its list of eligible relatives, defines the relatives for whom a taxpayer may claim a dependent exemption. See 26 U.S.C. 151-52. Section 152(d)(2) sets forth

subparagraphs (A) through (H) to identify the following 8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Congress specifically chose not to carry over subparagraph (H) to 25 subparagraph (C)(iii) of 7702B(f)(2). 26 27 28 4 to exclude subparagraph (H) in subparagraph (C)(iii) of Had Congress not chosen (G) (H) A son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law. An individual . . . who, for the taxable year of the taxpayer, has the same principal place of abode as the taxpayer and is a member of the taxpayer's household. (F) individuals as "qualifying relatives" for the exemption: (A) (B) (C) (D) (E) A child or a descendant of a child. A brother, sister, stepbrother, or stepsister. The father or mother, or an ancestor of either. A stepfather or stepmother. A son or daughter of a brother or sister of the taxpayer. A brother or sister of the father or mother of the taxpayer.

26 U.S.C. 152(d)(2). When it chose to incorporate subparagraphs (A) through (G),

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7702B(f)(2), registered domestic partners would have been eligible to enroll in the CalPERS LTC program. Instead, CalPERS has refused to make its LTC insurance program available to the registered domestic partners, as well as the same-sex spouses, of the public employee Plaintiffs. Plaintiffs' complaint asserts that Congress violated the Constitution by excluding registered domestic partners as

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 the District of Columbia had passed the Health Care Benefits 16 Expansion Act, establishing a domestic partnership registry in 17 18 19 20 21 22 23 an attack on the family in this country, it is this Domestic 24 25 26 27 28 The Health Care Benefits Expansion Act of 1992, D.C. Law 9114, which established the District of Columbia's domestic partnership registry, was assigned Act No. 9-188 after its passage by the Council and approval by the Mayor. See D.C. Code 36-1401 (legislative history of law 9-114). 5
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relatives eligible for enrollment in qualified state-maintained long-term care insurance plans. In 1996, when Internal Revenue Code 7702B(f) and the DOMA were passed, registered domestic partnership laws had not been widely adopted. Nonetheless, Congress had discussed registered In April 1992,

domestic partnerships prior to and during 1996.

that jurisdiction.

Congress reacted to the District of Columbia's

new law by barring any local or federal funding to implement, enforce or administer the registry. District of Columbia

Appropriations Act, 1993, Pub. L. No. 102-382, 106 Stat. 1422 (1992).1 Representative Clyde Holloway argued, "If there ever was

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Partnership Act . . . To me, this bill totally destroys the families of this country." 96521, at *H2950. 138 Cong. Rec. H2950-04, 1992 WL

He stated, "I do not think anyone that is

homosexual can stand here on this floor and openly tell me that homosexuality is good for the future of America." H6120-02, 1992 WL 156371, at *H6129. In arguing against the appropriations ban before the Senate, 138 Cong. Rec.

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 Columbia Appropriations Act, 1993, became law. 16 17 18 19 20 21 22 23 24 25 26 27 28 The record includes mention of Travis County in Texas, Dane County in Wisconsin, the California counties of Alameda, San Mateo and Santa Cruz, the cities of Berkeley, Los Angeles, Oakland, Santa Cruz, San Francisco, West Hollywood, New York, Ithaca, Cambridge, West Palm Beach, Ann Arbor, East Lansing, Madison, Minneapolis, Seattle, and Tahoma Park, as well as others in which domestic partner organizing efforts were underway. 6
2

Senator Brock Adams entered into the Congressional record information detailing domestic partnership recognition in numerous jurisdictions, apart from the District of Columbia.2 Rec. S10876-01, 1992 WL 180795, at *S10904. On July 30, 1992, the appropriations bill was amended to include the funding ban, and on October 5, 1992, the District of Pub L. No. 102138 Cong.

382. The ban on funds for the District of Columbia's domestic partnership registry was renewed in subsequent years. In 1993, as

part of a successful drive to renew the ban, Representative Ernst Istook argued, "Now, obviously this was passed by the District of Columbia to enable people, more than anything else, who are in a

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homosexual relationship to register an equivalent of a gay marriage. That is one of the reasons that this particular 139 Cong. Rec. H4353-01, 1993

proposal is abhorrent, in my view." WL 236117, at *H4355, *H4358.

The District of Columbia Pub. L. No. 103-127,

Appropriations Act, 1994, included the ban. 107 Stat. 1336 (1993).

In 1994, Representative Robert Dornan proclaimed, "From my 8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 334, 108 Stat. 2576 (1994). 16 In 1995, opponents of registered domestic partnerships again 17 18 19 20 21 22 23 24 never passed during the budget impasse of 1995, in 1996, during 25 26 27 28 the same legislative session in which 7702B(f) and the DOMA were passed, Congress passed continuing appropriations, which included the ban on funding of the registry. 7 Continuing Appropriations, sought to include the ban in the District of Columbia Appropriations Act, 1996. Representative Cliff Stearns asserted historical knowledge, this business of domestic partner benefits started in Seattle where they were trying to give privileged treatment to lesbian and homosexual partners . . . Let us get rid of this domestic partnership nonsense." 1994 WL 363727, at *H5601. 140 Cong. Rec. H5589-02,

Again, the funding ban was approved.

District of Columbia Appropriations Act, 1995, Pub. L. No. 103-

that domestic partnership registration laws "undermine the traditional moral values that are the bedrock of this Nation." 141 Cong. Rec. H11627-02, 1995 WL 639923, at *H11657. Although the District of Columbia Appropriations Act was

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1996, Pub. L. No. 104-90, 110 Stat. 3 (1996). No. 104-92, 110 Stat. 16 (1996).

See also, Pub. L.

Later that year, Congress passed

two appropriations bills that also contained the ban on funding for the registry. Omnibus Consolidated Rescissions and

Appropriations Act of 1996, Pub. L. No. 104-134, 110 Stat. 1321 (1996); District of Columbia Appropriations Act, 1997, Pub. L. No. 104-194, 110 Stat. 2356 (1996) (captioned "Prohibition on Domestic

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 the context of Congress' consideration of the DOMA. 16 17 18 19 20 21 22 23 24 25 26 27 28 The record of animus is detailed in this Court's January 18, 2011 order denying Federal Defendants' motion to dismiss Plaintiffs' constitutional challenge to section three of the DOMA. 8
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Partners Act"). The record of Congress' consideration of the DOMA, which also occurred in 1996, likewise evidences animosity and moral condemnation of same-sex relationships.3 Gill v. Office of

Personnel Mgmt., 699 F. Supp. 2d 374, 378-79 (D. Mass 2010). Indeed, the issue of registered domestic partnerships arose within The day

Senator Nickles introduced the bill to enact the DOMA, he explained that the law was needed to circumvent the recognition of registered domestic partners under federal law. He stated,

Another example of why we need a Federal definition of the terms "marriage" and "spouse" stems from experience during debate on the Family and Medical Leave Act of 1993. Shortly before passage of this act, I attached an amendment that defined "spouse" as "a husband or wife, as the case may be." When the Secretary of Labor published his proposed regulations, a considerable number of comments were received urging that the definition of "spouse" be "broadened to include domestic partners in committed relationships,

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including same-sex relationships." When the Secretary issued the final rules he stated that the definition of "spouse" and the legislative history precluded such a broadening of the definition. 142 Cong. Rec. 4851-02, 1996 WL 233584, at *S4869-70.

4 5 6 7 8 9 10 United States District Court For the Northern District of California 11 legal unions by State and Federal laws." 12 13 14 15 16 17 18 19 Congress continued until 2001 to approve annually the ban on 20 21 22 23 24 25 26 27
4

A proposed amendment to the bill that became the DOMA would have required the General Accounting Office4 to "undertake a study of the differences in the benefits, rights and privileges available to persons in a marriage and the benefits, rights and privileges available to persons in a domestic partnership resulting from the non-recognition of domestic partnerships as 142 Cong. Rec. 7480-05,

1996 WL 392787, at *H7503.

Representative Charles Canady stated,

in opposition to the amendment, "This motion represents a transparent attempt to give some statutory recognition to domestic partnerships." 142 Cong. Rec. 7480-05, 1996 WL 392787, at *H7504.

The amendment to require the study of domestic partnerships was defeated. 142 Cong. Rec. 7480-05, 1996 WL 392787, at *H7505.

the use of local and federal funds to implement the District of Columbia's domestic partnership registry. District of Columbia

Appropriations Act, 1998, Pub. L. No. 105-100, 111 Stat. 2160 (1997); Omnibus Consolidated and Emergency Supplemental Appropriations Act, 1999, Pub. L. No. 105-277, 112 Stat. 2681 (1998); Consolidated Appropriations Act, 2000, Pub. L. No. 106-113 Now, the Government Accountability Office. 9

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(1999), District of Columbia Appropriations Act, 2001, Pub. L. No. 106-522, 114 Stat. 2464 (2000). In 1998, Representative Frank

Riggs stated, "[W]e as Federal lawmakers have a duty to oppose policies and laws that confer partner benefits or marital status on same-sex couples." *H7343. 144 Cong. Rec. 7335-03, 1998 WL 454432, at

Representative Riggs took the position that the registry,

if permitted to take effect, would "legitimize same-sex activity." 8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 Wellstone catalogued the number of cities, municipalities, 16 counties, businesses, non-profit organizations and unions that 17 18 19 20 21 22 23 24 In 2001, Congress authorized a more limited appropriations 25 26 27 28 ban, permitting the use of non-federal funds to institute and administer the District of Columbia domestic partnership registry. District of Columbia Appropriations Act, 2002, Pub. L. No. 107-96, 10 offered domestic partnership benefits. 1998 WL 55803, at S733. 144 Cong. Rec. 731-02, Id. Also in 1998, Congress considered the Domestic Partnership Benefits and Obligations Act of 1998, introduced by Senator Paul Wellstone. This Act would have provided benefits to the domestic 144 Cong. Rec. S1959-02, 1998 WL

partners of federal employees. 109601.

In his statement in support of the bill, Senator

Senator Wellstone further expressed his

disappointment that Congress had yet to offer domestic partnership benefits when such benefits "have already been offered in some cities and by some businesses since 1982 . . ." not passed. Id. The bill was

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115 Stat. 923 (2001).

Accordingly, in 2002, the District of

Columbia finally implemented its domestic partnership registry. See 49 D.C. Reg. 5419 (June 14, 2002).5 Internal Revenue Code 7702B(f)(2)(C)(iii) was amended in 2004 in the Working Families Tax Relief Act, Public Law No. 108311, 118 Stat. 1166 (2004). Congress did not take that

7 8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 it rests. 16 17 18 19 20 21 22 23 1986). 24 25 26 27 28 In 2010, Congress lifted the ban on federal funding for the District of Columbia's domestic partnership registry. See Consolidated Appropriations Act, 2010, Public Law 111-117 (Division C--Financial Services and General Government Appropriations Act, 2010); H.R. Rep. 111-202, at 7. 11
5

opportunity to change the provision to include registered domestic partners. By then, California, New Jersey, Washington and Maine

had enacted domestic partnership legislation. LEGAL STANDARD Dismissal under Rule 12(b)(6) for failure to state a claim is appropriate only when the complaint does not give the defendant fair notice of a legally cognizable claim and the grounds on which Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007).

A complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." 8(a). Fed. R. Civ. P.

In considering whether the complaint is sufficient to

state a claim, the court will take all material allegations as true and construe them in the light most favorable to the plaintiff. NL Indus., Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir.

However, this principle is inapplicable to legal

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conclusions; "threadbare recitals of the elements of a cause of action, supported by mere conclusory statements," are not taken as true. Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 1949-50

(2009) (citing Twombly, 550 U.S. at 555). DISCUSSION I. Equal Protection The doctrine of equal protection exists to ensure the

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 suspect class, courts apply strict scrutiny to determine the 16 constitutional validity of the provision. 17 18 19 20 21 22 23 24 pervasive and often subtle discrimination." 25 26 27 28 that does not burden a protected class is subject to a lower standard of review and need only "bear[] a rational relationship to some legitimate end." Romer, 517 U.S. at 631. 12 Id. at 273. A law of Retirement v. Murgia, 427 U.S. 307, 312 (1976). Such laws are See Massachusetts Bd. Constitution's promise of equal treatment under the law. Evans, 517 U.S. 620, 631 (1996). Romer v.

Certain classifications by

statute or other government activity, such as classifications based on race, have been found to be suspect. Harris v. McRae,

448 U.S. 297, 322 (1980) (noting race as "the principal example" of a "suspect" classification). Where a challenged law burdens a

"presumptively invalid and can be upheld only upon an extraordinary justification." Personnel Administrator of Mass. v. Courts apply an intermediate

Feeney, 442 U.S. 256, 272 (1979).

level of scrutiny to certain other classifications, such as those based upon sex, which "have traditionally been the touchstone for

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Plaintiffs claim that 7702B(f) violates registered domestic partners' constitutional right to equal protection on the basis of sexual orientation and gender. Plaintiffs assert, but point to no controlling authority for the proposition, that classifications on the basis of sexual orientation are suspect, akin to racial classifications, triggering judicial scrutiny of the highest order. Federal

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 Office, 895 F.2d 563, 574 (9th Cir. 1990)). 16 the Airforce, 527 F.3d 806, 821 (9th Cir. 2008), a Ninth Circuit 17 18 19 20 21 22 23 24 Bowers[v. Hardwick, 478 U.S. 186 (1986)], it undercut the theory 25 26 27 28 [and] reasoning underlying High Tech Gays and Philips in such a way that the cases are clearly irreconcilable, under Miller v. Gammie, 335 F.3d 889, 900 (9th Cir. 2003)) (alteration in 13 panel held that Lawrence v. Texas, 539 U.S. 558 (2003), did not disturb the application of rational basis review to an equal protection challenge to a federal policy permitting the discharge of service-members on account of homosexual activity. Cf., Witt, In Witt v. Dept. of Defendants agree that the Court should hold that sexual orientation is a suspect classification. General, Docket No. 64-2. Letter from Attorney

However, in the Ninth Circuit, gays and

lesbians have been held not to constitute a suspect or quasisuspect class. Philips v. Perry, 106 F.3d 1420, 1425 (9th Cir.

1997) (citing High Tech Gays v. Defense Indus. Sec. Clearance

527 F.3d at 824-25 (J. Canby's opinion concurring and dissenting in part, arguing that because Lawrence unequivocally overruled

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original).

The Ninth Circuit may, in light of developments in the

law, decide to change its ruling on the degree of protection to be provided to gays and lesbians as a class, but unless and until it does, this Court must follow its current holdings. Although the Supreme Court has not established that sexual orientation is a suspect or quasi-suspect class for purposes of the equal protection doctrine, it did hold in Romer that gays and

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 reiterated, "If the constitutional conception of equal protection 16 of the laws means anything, it must at the very least mean that a 17 18 19 20 21 22 23 24 not a sufficient reason for upholding a law prohibiting the 25 26 27 28 14 practice . . .") (quoting Bowers, 478 U.S. at 216 (Stevens, J., dissenting)). Thus, the Supreme Court has held that anti-gay bare desire to harm a politically unpopular group cannot constitute a legitimate governmental interest." Id. at 634-35 lesbians, as a class, are at least protected from burdensome legislation that is the product of sheer anti-gay animus and devoid of any legitimate government purpose. 517 U.S. at 632-35

(holding that Colorado's anti-gay ballot measure "defies even [the] conventional inquiry" applied under the rational basis test). In striking down the ballot measure, the Supreme Court

(quoting Department of Agriculture v. Moreno, 413 U.S. 528, 534 (1973)) (internal quotation marks and alterations omitted). See

also, Lawrence, 539 U.S. at 577 ("the fact that the governing majority in a State has viewed a particular practice as immoral is

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animus is not a legitimate governmental interest that may serve to justify legislative enactments burdening gays and lesbians. The Court considers next whether the classification in 7702B(f) is justified, so as to withstand Plaintiffs equal protection challenge. As noted earlier, the rational basis

standard applies where a challenged enactment does not burden a protected class. Romer, 517 U.S. at 631.

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 challenged distinction actually motivated the legislature." 16 v. Beach Comm., 508 U.S. 307, 313 (1993). 17 18 19 20 21 22 23 24 Plaintiffs contend that there is no fairly conceivable 25 26 27 28 rational relationship between a legitimate government interest and the exclusion of registered domestic partners from subparagraph (C)(iii) of 7702B(f). Instead, they posit that the enactment 15 rational basis test is not "toothless." U.S. 181, 185 (1976). Mathews v. De Castro, 429 On the other hand, the FCC Under the rational basis test, a law that imposes a classification must be rationally related to the furtherance of a legitimate state interest. Id. This standard of review accords a Heller

strong presumption of validity to legislative enactments. v. Doe, 509 U.S. 312, 319 (1993).

"[I]t is entirely irrelevant

for constitutional purposes whether the conceived reason for the

"[E]ven in the ordinary equal protection

case calling for the most deferential of standards, [courts] insist on knowing the relation between the classification adopted and the object to be attained." Gill, 699 F. Supp. 2d at 387

(quoting Romer, 517 U.S. at 633).

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was based upon animus.

As noted earlier, the Supreme Court has

held that anti-gay animus is not a legitimate governmental interest that may serve to justify legislative enactments burdening gays and lesbians. Romer, 517 U.S. at 634-35. Federal Defendants take the position that 7702B(f)'s noninclusion of registered domestic partners is not based on sexual See Lawrence, 539 U.S. at 577;

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 legal status that provides a complement of established rights and 16 obligations for same-sex couples seeking legal recognition of 17 18 19 20 21 22 23 24 partnership to different-sex couples does not negate the burdens 25 26 27 28 faced by same-sex registered domestic partners. The laws limiting their relationships. That California permits different-sex orientation. First, Federal Defendants contend that excluding

registered domestic partnerships is not a proxy for sexualorientation-based discrimination because many states permit heterosexual couples to register as domestic partners. argument is not persuasive. This

In this state and many others,

registered domestic partnership is currently the only available

couples, in which one or both persons are age sixty-two or older, to choose registered domestic partnership over marriage does not diminish the plain reality that same-sex couples are relegated to registered domestic partnerships because legal marriage is prohibited for them. The availability of registered domestic

same-sex couples to registered domestic partnerships, while precluding them from marriage, turn on sexual orientation. 16

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Federal Defendants also argue that the varying scope of privileges afforded by different state registered domestic partnership laws means that the legal relationship is not a proxy for classification based on sexual orientation. also unavailing. This argument is

The number or type of privileges is irrelevant

when registered domestic partnerships provide the only relationship rights available to same-sex couples.

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 Federal Defendants posit that an impermissible purpose for the 16 exclusion of registered domestic partners is not reasonably 17 18 19 20 21 22 23 24 have had a domestic partnership registry, but for Congress' 25 26 27 28 decision to ban all appropriations to implement, enforce or administer the registry. Antipathy towards same-sex relationships inferred because no state recognized such relationships in 1996. However, the history delineated above demonstrates that when 7702B(f) was adopted in 1996, Congress was aware that a number of localities and entities across the country had recognized and protected same-sex couples by offering registered domestic partnerships. Indeed, in 1996, the District of Columbia would Federal Defendants also assert that Plaintiffs cannot show animus because the legislative history of 7702B(f) is devoid of any statement suggesting a purpose to discriminate against samesex domestic partners. Neither party points to legislative

history for 7702B(f) illuminating the reasons why Congress chose the eligible relatives contained in subparagraph (C)(iii).

infused successful efforts to block implementation of the 17

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registered domestic partnership law in the District from 1992 to 2001, which included the year that 7702B(f) was enacted. The

statements reflecting moral condemnation of gays and lesbians in the course of these deliberations support an inference that the exclusion of domestic partners from the list of family members eligible to enroll in federally qualified, state-maintained longterm care plans was motivated by animus.

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 partnership registry and its enactment of a federal definition of 16 marriage limited to heterosexual married couples, along with its 17 18 19 20 21 22 23 24 Even after the District of Columbia implemented its domestic 25 26 27 28 partnership registry and other states adopted their own, Congress, through the Working Families Tax Relief Act of 2004, enacted an amended version of 7702B(f) without adding registered domestic 18 record of animosity towards gays and lesbians, may serve as evidence of animus. See Arlington Heights, 429 U.S. at 267 Facts beyond the legislative record pertaining directly to 7702B(f) are relevant. This includes the legislative history of

provisions that Congress considered contemporaneously with the passage of 7702B(f). Congress' decision to omit a provision

specifically reaching registered domestic partners, concurrently with its denial of funding for the District of Columbia's domestic

(stating, in the context of a race-based, disparate impact claim, that the "historical background of the decision" and the "specific sequence of events leading up to the challenged decision" may shed light on the decisionmaker's purposes).

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partners or otherwise allowing states to enroll family members who were not expressly identified in subparagraph (C)(iii). Federal

Defendants attempt to diminish the legislation as a "technical amendment," but the Act established substantive law that, among other things, provided relief from the "marriage penalty" in certain tax brackets and repealed scheduled reductions in the child tax credit. Pub. L. No. 108-311.

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 registered domestic partners and its treatment of spouses. 16 Congress' record indicates that it saw registered domestic 17 18 19 20 21 22 23 24 allows for the evolution of state domestic partnership laws. 25 26 27 28 argument is not persuasive. Section 7702B(f) provides favorable This partnership as a marriage-like status. The omission of distant Next, Federal Defendants assert that 7702B(f) does not impermissibly discriminate against same-sex registered domestic partners because other relatives, such as cousins, and individuals who share a close, dependent, family-like relationship are omitted for reasons unrelated to sexual orientation. However, the

relevant comparison is between 7702B(f)s treatment of

relatives and other household members from the list of family members eligible for enrollment does not preclude a finding that 7702B(f) imposes a discriminatory classification. Federal Defendants contend that there is a rational basis for 7702B(f)'s exclusion of domestic partners because the limitation

federal tax treatment for long-term care plans maintained and administered by states. The provision does not have any bearing 19

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on how state domestic partnership laws evolve, one way or another. By allowing federally qualified, state-maintained long-term care plans to enroll only certain categories of family members, 7702B(f) simply withholds favorable tax treatment to domestic partners that a state otherwise recognizes. Federal Defendants contend that it was rational to decline to carry over subparagraph (H) of 152(d)(2) to subparagraph

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 could secure long-term care insurance from other sources. 16 fact that these private plans would enjoy the same tax benefits 17 18 19 20 21 22 23 24 maintained plan could be easily verified. 25 26 27 28 Defendants, the catch-all provision of subparagraph (H), which includes an individual living with the taxpayer as a member of the household during a given tax year, describes a relationship that 20 According to Federal under 7702B(f) as state-maintained plans does not explain the decision to exclude a particular group of family members from state-maintained plans. Federal Defendants assert that the eligibility limitation could be justified as a rational effort to assure that the eligibility of individuals seeking enrollment in a stateThe (C)(iii) of 7702B(f)(2), because (A) through (G) would reach an adequate number of family members. Federal Defendants assert that

the list of relatives identified in section 152(d)(2)(A)-(G) reasonably served the policy goal of encouraging individuals to participate in a state long-term care insurance plan, and ineligible family members, including registered domestic partners,

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may change from year to year.

This justification, however, cannot

be credited because the eligibility of spouses, step-relatives and relatives-in-law, which depends on the existence of a marital relationship, may likewise change from one year to the next. Marital relationships lack any minimum time commitment. Thus, the

exclusion of subparagraph (H) does not rationally relate to efforts to ease administration of state-maintained long-term care

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 interest of easing administrative burdens where the challenged law 16 amounted to "the selective application of legislation to a small 17 18 19 20 21 22 23 24 members was adequate to further the policy goals of 7702B(f) 25 26 27 28 suggests that the enactment was a rational decision to limit the subsidy provided by the law. It is conceivable that an group." Diaz v. Brewer, 656 F.3d 1008, 1014 (9th Cir. 2011) plans. See Moreno, 413 U.S. at 537-38 (holding that a provision

that limited eligibility for food stamps to households with "related" rather than "non-related" individuals was not rationally connected to efforts to curb abuse of the program). The Ninth

Circuit recently declined to credit the argument that a state law eliminating health care benefits for domestic partners served the

(affirming, in the context of a motion for preliminary injunction, the district court's finding that the plaintiff same-sex domestic partners were likely to succeed on their equal protection claim under the rational basis test). Federal Defendants' argument that the list of eligible family

incremental amount of tax revenue might be gained by not including 21

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1 2 3 4 5 6 7

registered domestic partners in subparagraph (C)(iii) of 7702B(f)(2). However, in light of the reasoning in Plyler v.

Doe, 457 U.S. 202, 227 (1982), and Rinaldi v. Yeager, 384 U.S. 305, 308-09 (1966), a law cannot satisfy the rational basis standard of review based on a mere cost-saving rationale. In Plyler, the Supreme Court considered the constitutionality of a state statute that withheld state funds for the education of

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 standard of review to the statute, and instead considered whether 16 the statute rationally furthered some substantial state interest. 17 18 19 20 21 22 23 24 classification with a concise expression of an intention to 25 26 27 28 discriminate." Id. at 227 (internal citation omitted). The Id. at 224. To the state's assertion that the challenged law undocumented children and authorized local school districts to deny enrollment in their public schools to children not legally admitted to the country. The Court held that undocumented

persons did not constitute a suspect class and the right to education did not comprise a fundamental liberty interest. 223. Id. at

Accordingly, the Court declined to apply the strict scrutiny

furthered the preservation of the states limited resources for the education of its lawful residents, the Court responded that a concern for the preservation of resources standing alone can hardly justify the classification used in allocating those resources . . . [The state] must do more than justify its

exclusion of the particular group, even if the group does not constitute a protected class, must be justified. 22 Id. at 229

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1 2 3 4 5 6 7

([T]he State must support its selection of this group as the appropriate target for exclusion.) (emphasis in original). Because the Court did not discern a conceivable, sufficient justification for excluding undocumented children, it invalidated the law. Similarly, in Rinaldi, 384 U.S. at 308-09, the Court stated that equal protection "imposes a requirement of some rationality

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 replenishing a county treasury by seeking reimbursement from those 16 who had directly benefited from its expenditures could serve as a 17 18 19 20 21 22 23 24 appeal. 25 26 27 28 of the penalty attached to the offense committed. The Court found Id. The factor distinguishing the groups was the nature legitimate basis for enacting the law. Id. at 309. However, in in the nature of the class singled out." There the Court struck

down, on equal protection grounds, a state statute that required indigent prisoners to reimburse the cost of a transcript in the event of an unsuccessful appeal, but did not impose the same obligation on indigents who received a suspended sentence, were placed on probation or were fined. The Court assumed that

applying the rational basis test, the Court noted that the law "fasten[ed] a financial burden only upon those unsuccessful appellants who are confined in state institutions," while those appellants who had been given a lesser sanction had received the same benefit from the county--a transcript used in an unsuccessful

the distinction arbitrary because it did not bear "some relevance to the purpose for which the classification [was] made." 23 Id.

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1 2 3 4 5 6 7

Under the reasoning in Plyler and Rinaldi, Federal Defendants must show that justifying the exclusion of registered domestic partners for the purpose of meeting federal fiscal objectives did not single out same-sex couples for arbitrary or impermissible reasons. Here, as noted above, the distinction between spouses

and registered domestic partners turns on sexual orientation, a factor that bears no relevance to the purpose for which 7702B(f)

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 spent a minimal amount on domestic partners' benefits). 16 repeating that Plaintiffs have provided legislative history 17 18 19 20 21 22 23 24 of animus that could explain the exclusion. 25 26 27 28 upon which Federal Defendants rely establishes that the rational basis test is satisfied where a challenged provision serves no legitimate government interest and the enactment is tainted by 24 None of the cases indicating that the distinction was actually motivated by anti-gay animus. In sum, Federal Defendants have failed to show a plausible, legitimate rationale for excluding registered domestic partners from 7702B(f)(2)(C)(iii)'s list of eligible family members, and the Court can think of none. Plaintiffs have pointed to a record It bears was enacted, that is, to incentivize the purchase of long-term care insurance to improve the financial security of families throughout the country. Moreover, the Ninth Circuit in Diaz

indicated that the cost-saving rationale may not succeed where the amount of savings rendered by excluding same-sex domestic partners is minimal. 656 F.3d at 1012-14 (noting evidence that the state

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1 2 3 4 5 6 7

animus against a politically unpopular group.

Therefore,

Plaintiffs' allegations on behalf of registered domestic partners are sufficient to state an equal protection claim under the rational basis test. On the other hand, the sex discrimination basis of Plaintiffs' equal protection claim fails because the allegations do not evidence purposeful invidious discrimination on the basis

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 Arguing that family autonomy and decisionmaking are protected 16 liberty interests, Plaintiffs claim that 7702B(f) violates their 17 18 19 20 21 22 23 24 interest." 25 26 27 28 Assuming that family autonomy and decisionmaking do amount to a constitutionally protected, fundamental right, 7702B(f) creates no more than an incidental economic burden on those interests. 25 William v. Glucksberg, 521 U.S. 702, 721 (1997). substantive due process rights by penalizing their exercise of such rights without a permissible basis. Under the doctrine of of sex. Feeney, 442 U.S. at 274. The Congressional record cited

by Plaintiffs demonstrates animus directed towards same-sex couples, not men or women. Plaintiffs have not demonstrated how

their allegations, if proven, would establish an equal protection violation based on sex discrimination. II. Substantive Due Process

substantive due process, when the government infringes a "fundamental liberty interest," the strict scrutiny test applies, and the law will not survive constitutional muster "unless the infringement is narrowly tailored to serve a compelling state

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1 2 3 4 5 6 7

Accordingly, the law does not trigger strict judicial scrutiny. See Lyng v. Auto Workers, 485 U.S. 360, 370 (1988) ("Because the statute challenged here has no substantial impact on any fundamental interest . . . we confine our consideration to whether the statutory classification 'is rationally related to a legitimate governmental interest.'"). In Lyng, the challenged provision prevented a family that was

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 "exceedingly unlikely" that the restriction would prevent a family 16 from "dining together" or compel a striking member to leave the 17 18 19 20 21 22 23 24 that contributions to lobbying efforts were not tax deductible, 25 26 27 28 while charitable contributions were. The Court held that the household in order to increase the household allotment of food stamps. Id. at 365. The Court reasoned that the law did not already on food stamps from receiving an increased allotment if a family member stopped working due to a strike. The provision also

barred families from becoming eligible for food stamps if their eligibility arose because a household member stopped working as part of a labor strike. The Court found that the law did not

interfere with familial living arrangements because it was

"directly and substantially" interfere with family living arrangements. Id. at 365-66.

In Regan v. Taxation with Representation of Washington, 461 U.S. 540, 549 (1983), the plaintiff challenged a tax provision

legislature is not required to subsidize the exercise of a fundamental right. The Court cited cases upholding the denial of 26

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1 2 3 4 5 6 7

subsidies for candidates in certain public elections, and the denial of subsidies to pay for abortions. Id. Accordingly, the

Court declined to subject the provision to strict scrutiny review. Plaintiffs rely on Cleveland Board of Education v. La Fleur, 414 U.S. 632, 639 (1974), which invalidated, on substantive due process grounds, an employer's policy which set arbitrary cutoff dates for when pregnant teachers were required to take leave and

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 work during the mandatory leave period. 16 Likewise, Speiser v. Randall, 357 U.S. 513 (1958), is 17 18 19 20 21 22 23 24 518. 25 26 27 28 27 "the effect of coercing the claimants to refrain from the proscribed speech." Id. at 519. Here, however, Plaintiffs cannot The Court reasoned that the challenged law necessarily had inapposite. There the Court struck down a law requiring persons could return to work. The Court found that the mandatory leave

policy penalized pregnant teachers for their decisions related to family creation, namely the decision to bear a child. Id. at 648.

However, La Fleur is less analogous to the present claim than Regan and Lyng because the law challenged in La Fleur was a more significant intrusion, in that the pregnant teachers could not

who sought to take advantage of a property tax exemption to sign a declaration stating that they did not advocate the forcible overthrow of the Government of the United States. The Speiser

Court stated, "To deny an exemption to claimants who engage in speech is in effect to penalize them for the same speech." Id. at

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1 2 3 4 5 6 7

plausibly allege that 7702B(f) has coerced same-sex couples to forgo engaging in same-sex relationships. Lyng and Regan preclude the application of strict scrutiny in deciding the domestic partner Plaintiffs' substantive due process claim. However, where strict scrutiny does not apply, courts

weigh a substantive due process challenge under the rational basis standard. See Glucksberg, 521 U.S. at 728 (applying the rational

8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 standards, even under the rational basis test. 16 Federal Defendants' motion to dismiss Plaintiffs' substantive due 17 18 19 20 21 22 23 24 // 25 26 27 28 28 // // process claim on behalf of registered domestic partners is denied. // // // // // Accordingly, basis test to a law banning assisted-suicide because it was held not to infringe on a fundamental liberty interest protected by the Due Process Clause). For the reasons explained earlier in the

Court's equal protection analysis, Plaintiffs have alleged sufficiently that the exclusion of registered domestic partners from subparagraph (C)(iii) of 7702B(f)(2) fails constitutional

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1 2 3 4 5 6 7 DENIED. 8 9 10 United States District Court For the Northern District of California 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated: 1/26/2012 IT IS SO ORDERED.

CONCLUSION Plaintiffs have stated a viable constitutional challenge to 7702B(f) under the doctrines of equal protection and substantive due process. Thus, Federal Defendants' motion to dismiss the

first and second claim in Plaintiffs' Second Amended Complaint to the extent they are brought by registered domestic partners is

CLAUDIA WILKEN United States District Judge

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